China or Russia: Who Will Dominate The Defense Market?

Russia has long held the advantage over China when it comes to the export of arms and defense systems, but that may soon change.

At the beginning of the Cold War, Chinese capabilities were boosted by the arrival of Russian technology. Following the Sino-Soviet split, a significant technology gap developed between the two nations, with China reduced to producing inferior versions of Soviet hardware, writes Robert Farley for The National Interest.

After the end of the Cold War, exports of Russian technology provided new impetus for the Chinese defense industry, and the two nations now have similar capabilities. Chinese technology may even overtake Russian in the next ten years, but for now Beijing and Moscow compete for market share in certain key areas.

Fighter Aircraft

China is set to produce a 5th-generation stealth fighter, known as the J-31, which will be available for export. As well as the more expensive J-31, Beijing is also selling the less high-tech JF-17 “Thunder” in conjunction with Pakistan.

The JF-17 has sold well over the past year, and the addition of the J-31 could enable China to target different markets, as well as those customers looking to diversify their air force capabilities.

At the same time the Russian Flanker family of jets continues to sell well to clients in Southeast Asia, although the MiG-29 has suffered from quality control issues. The future is not so bright, with only the PAK-FA in development, which continues to be the subject of high-level disagreements between India and Russia.

Submarines

China has deals in place with both Thailand and Pakistan for the sale of diesel-electric submarines, marking the first time that China will export underwater vessels. Beijing is certainly a threat to Moscow in the undersea market, as their submarines are very similar.

It is thought that the Russian transfer of Kilo-class submarines in the 1990s and 2000s allowed the Chinese to develop more advanced boats which can now compete with their Russian rivals.

At this point in time Russia still holds the considerable advantage of years of experience in the field, but that gap looks set to close as China delivers more vessels.

Tank

The team responsible for Russia’s high-tech Armata tank has said that they do not want the vehicle to be sold to China, perhaps due to China’s laissez-faire attitude to intellectual property law.

Although sales of the Su-27 Flanker plane suffered due to abuse of intellectual property by China, it seems as though the Armata may escape similar problems. Beijing is already working on its own tanks which could compete with the Armata.

Despite the threat of increased competition from China, it seems that India may cancel its Arjun battle tank. India would not consider buying Chinese arms, so Russia may find a market.

Air Defense

The recent sale of an S-400 surface-to-air missile system from Russia to China raised eyebrows in the defense community. However Moscow perhaps realized that Beijing has advanced so far with its own air defense technology that preventing a final transfer probably would not maintain its advantage.

Both nations are working hard to export air-defense systems. Russia plans sales to Iran and Brazil, but a Chinese deal with Turkey may not come to fruition. That said, the fact that talks reached an advanced stage shows how competitive Chinese technology has become.

Russia will likely see strong sales to those states which surround China, including Vietnam and Malaysia, but the technology gap is closing fast.

Missiles

Although the ballistic-missile market has slowed since the heady days of the Cold War, cruise-missiles are still being sold by both Russia and China to Southeast Asia, the Middle East and Africa. China is also closing the technology gap here, with systems which rival Russia’s for capabilities.

However Russia does have one advantage. Many potential customers are Southeast Asian countries who are engaged in territorial disputes with China in the South China Sea. As such, Russia may profit from a lack of desire to sell missiles to potential enemies of Beijing.

In Africa and Latin America, it seems as though both countries will compete for sales.

Conclusion

In general terms, China is rapidly catching up with Russia. Moscow desperately needs to maintain strong sales of military hardware given the dangers of an economy so heavily reliant on energy, and will surely defend its position as much as it can. However China has already significantly closed the gap, and despite certain geographical advantages for Russia, it would appear that China will provide stiff competition in the arms market in the next few decades.

Author: Brendan ByrneWhile studying economics, Brendan found himself comfortably falling down the rabbit hole of restaurant work, ultimately opening a consulting business and working as a private wine buyer. On a whim, he moved to China, and in his first week following a triumphant pub quiz victory, he found himself bleeding on the floor based on his arrogance. The same man who put him there offered him a job lecturing for the University of Wales in various sister universities throughout the Middle Kingdom. While primarily lecturing in descriptive and comparative statistics, Brendan simultaneously earned an Msc in Banking and International Finance from the University of Wales-Bangor. He's presently doing something he hates, respecting French people. Well, two, his wife and her mother in the lovely town of Antigua, Guatemala.
To contact Brendan or give him an exclusive, please contact him at theflask@gmail.com